Asia Water: This company continues to be the subject of a boardroom tussle. A failed attempt by EGN Nominees recently to oust the directors of the board has not spelt an end to the tussle.
Instead, EGN Nominees has now called for another EGM. Its sale of shares is puzzling given that EGN would need all the share support it can muster to win at the EGM.
However, it may be a case of profit taking as the stock price, at 21 cents now, has more or less doubled since EGN Nominees bought a big stake just a few months ago.
Recent story: INSIDER BUYING: Straits Asia Resources, Asia Water
JEL: This stock has been illiquid for a long time since a corporate scandal broke out in 2007, but it suddenly sprang to life on Friday (Sept 4). The stock price surged 42.3% to close up 1.5 cents at 5 cents.
Volume was a whopping 70.7 million shares, of which 20 million came from a married deal in which Eric Tan, its former chairman and former CEO, was the seller.
Eric Tan has been implicated in the scandal, and he stepped down from his posts after an independent review conducted by KPMG Forensics found manipulation of accounts.
The manipulation led to group profit overstatements totalling $11.84 million for FY2006 and the first half of 2007.
This case is now before the courts. Aside from Eric Tan, others charged are: Ng Soon Heng, the financial controller; ex-deputy CEO and CFO Wee Teck Han; and ex-COO Eric Leow Hock Leong.
JEL once was a high-flying stock that attracted investors such as Sam Goi and Koh Boon Hwee. As of the latest annual report, they are still major shareholders.
For more on the scandal, here is a link to an article at the Corporate Governance & Financial Reporting Centre.
Sinotel Technologies: After a fantastic stock run, a substantial shareholder could not resist taking profit even though at the 60-cent level, the PE of Sinotel is still at a low 5-6X this year’s forecast earnings (according to AmFraser Securities and Kim Eng Securities).
Shortly after the sale by Andrew Barron Worden, the substantial shareholder, Sinotel announced a placement of 28 million shares at 50.52 cents apiece to raise working capital. This is going to be useful as it enables it to take on more jobs in China’s unprecedented multi-trillion-dollar 3G network rollout.
Interestingly, with the share placement, a new major shareholder looks set to come on board Sinotel.
Sinotel said the placement shares would be placed to investors which including Providence SOGF Limited, which holds a value-centric investment philosophy and specialises in late stage private equity and PIPE (private investment in public equity) transactions.
Providence Capital Management is located in Singapore Land Tower, doesn't have a website, and is not related to a US global giant fund management company called Providence Equity Partners.
